Most of us think wealth is just money: the cash in our bank, the value of our home, or the size of our financial portfolio. Some people chase it; others hoard it or fear it. For most, money represents safety and security, and we spend a considerable chunk of our lives trying to accumulate it. And we worry about it—for some, almost constantly. As a consequence, all too often families break up over money distress.

Money no longer goes as far as it once did. As the co-owner and CEO of a family office wealth management firm, I have been fortunate to work with families of wealth for the past thirty years. I can tell you many of these folks have trouble with the idea of money too. These wealth creators have millions of dollars at their disposal and yet they’re often afraid it will be lost, which makes them feel insecure about their and their children’s future (the more you have, the more you have to lose in so many ways). But being “rich” means little if you do not feel “enriched”.

Most young adults are worried about money too, which distorts the choices they make in life. Even if they grew up with money, they too often don’t know how they’ll ever afford a home of their own or the lifestyle they once had. In their eyes, opportunities are few, competition is fierce, money is scarce, and hope is drying up. They often feel they have to choose between a career that makes good money and one that would be inspiring and fulfilling to them. Why must they choose one at the expense of the other?

Wealthy or not, we all have something in common. Most of us struggle with our relationships to money and to each other. Clearly, our attitude toward money is all wrong. Too many of us accumulate money only to feel safe rather than use it for the joy of creation. It’s time to remember what money is meant for: as a tool of exchange between people who care about each other’s well-being, to equalize everyone’s right to a good life, and to play with in the act of creation.

It’s also time to rethink wealth. Wealth is having an abundance of what we most treasure. That is True wealth. Yes, this includes money, but it also includes a loving group of people who support us. We call that group “family,” whether by blood ties or not. True wealth is good health, self-confidence, and high self-esteem. It is having an education and continued opportunities for lifelong learning. True wealth is having a personal mission and clarity of life direction. It is the opportunity to give our unique talents to the world and create. True wealth is our experiences and life lessons, our traditions and memories. It is our hopes, dreams, and challenges. In other words, a life of True wealth is built upon a clear and great purpose, loving relationships, and many achievements. Money without loving relationships is shallow. Loving relationships without money is wasted potential. A family is truly wealthy only when each member thrives. Many will agree with me when I say we are only as happy as our least happy child.

This brings me to the purpose of True Family Wealth. I want to share what I have learned and to inspire you to think differently about your resources, regardless of whether you currently find them lacking or abundant. Do you have to be financially wealthy to benefit from this book? No. But you do have to be interested in wealth creation, and see yourself as a wealth creator.

This book offers a different perspective on money and family. I also provide you a system that has helped me and my family thrive. It has given me the power to create and preserve the business I want, the family I want, and the life I want by working with change instead of fearing it. My goal with True Family Wealth is to provide a tool to empower True wealth creators so they can experience the life they want themselves and the next generations. This includes money, to be sure, but also the power of family relationships and our ability to create together. I call this system The Family Treasury™. It creates Enriched families as it cultivates True wealth and helps sustain it for generations.

In True Family Wealth, I share the step-by-step Family Treasury process that will equip you to achieve the wealth you truly want and to keep it for future generations to enjoy. This system enables family leaders, successors, and follow-on generations to steward True family wealth in a sustainable way. Your family can be an Enriched Family today and into the future.

True Family Wealth is about putting the power to create and preserve wealth back into the loving hands of family. Although I chose to focus on family because this is typically the place where people feel most free to express themselves, the system can also just as easily be used by the individual, a business, or community groups.

It is a holistic approach to wealth stewardship for the new age. For family’s who have achieved a certain measure of financial independence, this can lead to the “family bank”, which you can use to invest in your family’s well-being for generations to come. More important, as CEO of The Family Treasury, you will have the opportunity to mentor the next generations and pass on the values, experiences, and wisdom you have earned over the years.

If you already consider yourself blessed with abundant financial wealth and professional success, this book is written for you. If you are or want to be, a wealth creator this book is for you. If you consider yourself still stretching toward your own financial security, then this book is written for you. If you are somewhere in between—successful but not wealthy or wealthy but not successful—this book is, you guessed it, also written for you. But if you think you have all the money you want and need, both for your benefit and for the benefit of subsequent generations; you have no fear of losing it; your family relationships are warm, unconditionally loving, and supportive; and your future is even bigger and brighter than your past, then please still read this book. Why? Because you have a responsibility to teach what you know to your next generation, and the Family Treasury can help you do that.

]]>http://www.moneysense.ca/news/prosperous-families/feed/0Finding a financial adviserhttp://www.moneysense.ca/columns/finding-a-financial-adviser/
http://www.moneysense.ca/columns/finding-a-financial-adviser/#commentsWed, 29 Feb 2012 15:30:59 +0000http://www.moneysense.ca/?p=23809Managing money not your forte? A financial planner can help. Bruce Sellery offers his tips on how to pick the right one.

I know myself. I’m not the type of person who can manage my money alone. So how do I go about finding a financial adviser?

Answer

Most people put more time and energy into shopping for a coffee maker than they do choosing a financial planner. Coffee is important, no question, but a financial planner can have a huge impact on your financial health. This impact can be felt in tangible ways — you reach your financial goals or you don’t. And intangible ways — you feel clear, confident and empowered about your money or you feel unclear, unfocused and stressed.

Here are the basics steps to follow to find a financial adviser. Note that this will take you at least eight hours over the course of a few weeks, but it will be worth it. Really.

Determine your search criteria

What you want in a financial planner can be different from what your best friend wants. So take a few minutes to think about the criteria that are most important to you. Here is my basic list. If you want a more detailed description, click here. Feel free to borrow the points that are relevant to you or come up with an entirely new list:

Delivers performance that meets the benchmark index over time

Communicates in a way that works for you

Provides solid advice and doesn’t just sell products

Understands and works on all your goals

Holds you accountable for achieving those goals

You will notice that “nice” is not on my list. Neither is “fancy car/suit.” I don’t really care if the financial planner is nice or well dressed. Sadly, those external attributes reign supreme for many people, to their detriment.

Develop a list of advisers to interview

Interview? Yep. Interview. I know that this is a totally annoying step, but it is critical. Here are two ways to find people to interview.

1. Ask for referrals from people in your community

Send an email to your friends and family that outlines your search criteria. The mistake many people make it to simply ask for a referral. That will give you some names, but not necessarily names that fit what you want. Don’t be surprised if your friends and family don’t have suggestions. My experience is that a lot of people have financial advisers, not a lot of people have a relationship that is good enough to lead to a referral.

2. Access online resources

A referral from someone you know can be a great way to find an adviser, but it doesn’t always get you the result. There are a bunch of online resources to help you build your short list. They provide names and numbers, but don’t vet the candidates.

The Financial Planning Standards Council has a “find a planner” tool on its website.

Interview at least three advisers

Financial advisers aren’t regulated in the way that many service providers are. Doctors and lawyers, for example, have very clear education requirements and a regulatory body that oversees it members. Not so here. The most recognized designation in Canada is the CFP or certified financial planner, but there are lots of people who call themselves financial planners who have no designation at all.

The interview questions I recommend cover off a number of areas, but aren’t exhaustive.

Get to know your financial planner
How long have you been in this line of work?
What designations do you have and what did it take to get them?
How would you describe your approach to advising clients?
Do you provide a written financial plan and what does it look like?
Can you provide me with a few references to check?

Fees
Based on a portfolio of my size, how much will I pay in commissions and other fees?
What do you recommend that your clients do to get the most out of the money they pay you?

Performance
Can you show me an example of the performance statement you use?
Will you provide with updates on how my portfolio is doing versus the benchmark index?

Life goals
How do you factor in life goals that aren’t related to retirement or investments?

Choose your best candidate

Take some time to reflect on the candidate’s answers to your questions, and reference back to your criteria. Have you found someone who will be able to do what you want? If yes, proceed. If no, keeping interviewing.

Yes, this is a lot of work and it still won’t guarantee you’ll find someone great. But it will sure increase the probability.

I’m doing well in my career and my savings are growing. What is the most important thing I need to do to build wealth?

Answer:

I drive a 1997 Honda CRV. It’s in great condition, but a car built during Bill Clinton’s first term as president is hardly the prettiest in the parking lot. Car designs have advanced significantly since we bought it—used—but I haven’t succumbed to buying something newer. Why?

I’m avoiding lifestyle inflation. This is the idea that as your income increases so does your lifestyle, eliminating your ability to save more for your future. Our family income has increased over time, but we have been very focused on not letting our spending rise at the same rate.

If you were struggling to make ends meet, I’d have different advice on building wealth. But you are doing well in your career, and already “living within your means”’ which is one of the commandments of personal finance. Of course I endorse this message in general, but I would add the caveat that as your means increase, you need to increase the amount you save more than the amount you spend to avoid lifestyle inflation. If you get a raise at work, hooray: celebrate, then increase your automatic TFSA or RRSP withdrawal so that 75% of the raise goes to saving and just 25% to spending.

As a society, we now focus more on ‘I deserve’ than on ‘I can afford.’ As our income increases we feel we deserve more, and that means that we don’t move any further ahead on savings. The troubling reality is that most people are under-saving these days—just look at the staggering amount of unused RRSP contribution room out there. Yet the sale of consumer electronics has never been higher.

I do want to make one other point very clear: I try to avoid lifestyle inflation for a reason and it isn’t because I’m a miser. Wealth to me isn’t about having a big number in my bank account. It is about having choices. Driving a 1997 Honda CRV and avoiding lifestyle inflation in the present gives me many more choices for the future. I could have seat warmers and Bluetooth, but I don’t. And to me it’s worth it. Barely.

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Canada has long lived in the shadow of the U.S. Our living standards were lower, our inferiority complex was higher, and we suffered from perpetual brain-drain as our most ambitious citizens sought out opportunities south of the border.

Now the tables are turning. The U.S. economy is weakening, the greenback is falling and the data shows that the mean net worth for Canadian adults—$245,455—is just one whisker away from the $248,395 figure for Americans.

]]>http://www.moneysense.ca/magazine-archive/catching-up-with-uncle-sam/feed/2The payoff: Reaching true wealthhttp://www.moneysense.ca/magazine-archive/the-payoff-reaching-true-wealth/
http://www.moneysense.ca/magazine-archive/the-payoff-reaching-true-wealth/#respondThu, 10 Nov 2011 17:00:19 +0000http://www.moneysense.ca/?p=20128This University of Toronto philosophy professor writes about reaching "true wealth" and what it took to get him there

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I was the sort of kid who maintained a substantial cache of carefully catalogued Halloween candy into early December, by which time I had finished my Christmas shopping. I know, sad. But this combination of thrift and micromanagement, bequeathed to me by my blue-collar grandparents and a control-freak mother, has proved helpful in my chosen career of professional philosopher.

The minimum qualification for this strange job, the Ph.D. degree, requires at least eight and usually more like 12 years of post-secondary study. It’s a long haul in every sense. As Stephen Leacock said, “The meaning of this degree is that the recipient of instruction is examined for the last time in his life, and pronounced completely full. After this, no new ideas can be imparted to him.” We should add, these days, that no bank or agency will lend him another dime.

I learned all I needed to know about money in grad school. Like most grad students, I was poor both in relative terms (most of my friends had jobs and were earning money, buying houses) and absolute ones (no savings, no restaurant meals, no new clothes, a hand-me-down TV). I never valued the small luxuries of life—a bottle of wine, a hardcover novel bought on a whim, a concert ticket—more than when I coul-dn’t afford them.

I was 28 years old when I fin-ished my Ph.D. With a combination of frugal living and scholarships I had narrowly avoided the debt that cripples so many graduates. But then as now the academic career market was a shambles. I had no job and not much prospect of one. (It was 1991; the economy was in yet another post-recession slump.) There were lean years to come, stitching together contract work here and a freelance cheque there. I went through all the usual contortions of the semi-employed academic. Go to law school? Commit to journalism? Apply for the foreign service? (I actually did that one, got as far as a job offer, and then balked.)

When I finally landed a secure job, in 1998, I was 35 and it was too late to save my marriage. My wife was an academic too, deep in her own Ph.D., but with somewhat extravagant tastes—a fatal combination. We split the meagre amounts on our asset lists and went our separate ways.

They say true wealth resides in never having to worry about money. Or, according to the Micawber Principle, from Dickens’s Great Expectations: “Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.”

Which is of course why a majority of millionaires still report that they “feel poor.” When I was researching a book about the nature of happiness, I kept coming across different versions of this statistical result. Most people, no matter what their net worth, believe that they will be happy with just a little more, usually around 10%. The psychology should be clear: 10% represents an improvement within reach, but also sufficient to leverage a meaningful difference. It’s the monetary equivalent of the 10 or 15 pounds most people figure they ought to lose in order to feel good about themselves.

The catch is that the 10% income bump is like the horizon: it forever recedes even as you approach it. The ancient Greek philosophers didn’t need psychology or statistics to see the trap. There is, they tell us, a human vice called pleonexia, their term for that familiar double bind whereby the more you have, the more you want. Pleonexia is more than mere greed; it is a kind of intrapsychic race to the bottom. Each gain in material advantage generates within the soul a new deficit in happiness. Hence the need to seek a further gain. And so on, ad infinitum.

There are lots of different views on how to halt this downward spiral. You can tamp down your desires, detach yourself from the world of getting and spending, or sever all connections to material things. As the old Shaker hymn has it, “ ’Tis a gift to be simple.”

But there are also other balms to the over-excited soul than asceticism. Now that I can afford simple luxuries and, now and then, extravagant ones, I find solace in collecting art—sketches and studies, mostly, rather than full pieces beyond my means. It’s the only purchasable thing I know whose essence transcends price. No matter what you pay for it, its value remains incalculable.

And yes, I hoard and catalogue the art just like I did the Halloween candy. The great thing is that the collection never gets smaller, and the happiness is never in deficit, no matter how much I indulge myself. Now that’s a gift that keeps on giving.

Mark Kingwell is a professor in philosophy at the University of Toronto and the author of 16 books including The Wage-Slave’s Glossary (Biblioasis).

]]>http://www.moneysense.ca/magazine-archive/the-payoff-reaching-true-wealth/feed/0Do you think like a millionaire?http://www.moneysense.ca/magazine-archive/june-2011/do-you-think-like-a-millionaire/
http://www.moneysense.ca/magazine-archive/june-2011/do-you-think-like-a-millionaire/#respondTue, 16 Aug 2011 14:36:33 +0000http://www.moneysense.ca/?p=17349If you invest, borrow and slash your taxes like the wealthy do, will you become rich too? It’s not a bad start.

Can we learn from the rich? It’s tempting to write them off as lucky, but it’s not true. A recent study by BMO Harris Private Banking found that—rather than winning the lottery or inheriting their wealth—a full 94% of Canadians with more than $1 million in investable assets made the bulk of their fortunes on their own. Given such self-made success, it’s not overly presumptuous to suggest that we can indeed learn from the wealthy. Not just about how to make money, but how to grow it and keep it as well.

With that in mind, in the upcoming section of this report we focus on how the wealthy invest, borrow and pay taxes. They really do have a different approach. For instance, high-net-worth individuals are generally better at putting together long-term wealth plans than regular people. While most of us scramble to make last-minute RRSP contributions or start wondering how to reduce taxes in retirement the year we retire, the wealthy tend to realize that building wealth and reducing taxes requires a plan that allows you to see decades into the future.

Rich people are also better at diversifying. Of course, it’s easier to spread your bets across different asset classes when you have a bigger portfolio, but diversification is becoming easier for regular people. For example, new exchange-traded funds (ETFs) allow investors to track commodities, overseas indexes, and alternative investments more efficiently.

The wealthy are also better at keeping their investing fees low. They don’t invest their $5-million portfolios in mutual funds that charge a 2.5% fee. Those in the know make sure they don’t pay more than 1.5% in fees—a lesson we all can learn from. But that doesn’t mean that the rich are averse to paying for advice when it will save them money, such as clever ways to slash taxes.

Over the next week, we’ll drill down into common financial strategies used by the wealthy and let you know how they can be applied to your life. We start with a look at alternative investments, such as international real estate, hedge funds and futures. Then we explore strategies for using borrowed money. Finally, we discuss tax strategies that will allow you to keep more of that newfound wealth in your pocket. In each case, we look at what the wealthy do, and we include a special section on how the aspiring wealthy can benefit too.

]]>http://www.moneysense.ca/magazine-archive/june-2011/do-you-think-like-a-millionaire/feed/0Top 200 Canadian stocks 2011http://www.moneysense.ca/save/investing/mutual-funds/top-200-canadian-stocks-2011/
http://www.moneysense.ca/save/investing/mutual-funds/top-200-canadian-stocks-2011/#commentsTue, 18 Jan 2011 16:07:56 +0000http://www.moneysense.ca/?p=9956Last year’s all-stars beat the market with a huge gain of 19.7%. Over the past five years, we have outperformed every Canadian equity mutual fund. Care to meet the class of 2011?

As most seasoned investors know, beating the market isn’t as easy as it looks. Few amateur investors can do it for even a year or two. Despite their high six-figure salaries, most of the top mutual fund managers on Bay Street find themselves faltering after a just few years. But beating the market was the lofty goal we set ourselves with the MoneySense Top 200 All-Stars. And this year, we’re pleased to announce that we’ve done it again. In fact, in this, the seventh year of our stock-picking adventure, our Top 200 All-Stars cruised to an easy one-year gain of 19.7%—soundly trouncing the S&P/TSX Composite Index (XIC) by a full 5.5 percentage points. Even more impressively, when you look at our five-year performance history, you’ll find that we have once again outperformed every single Canadian equity mutual fund.

As it happens, this was about an average year for our top stocks. If you had bought equal amounts of the All-Stars and rolled your gains into the new players each year, you’d now be sitting on a 19.1% average annual return over the last six years, not including dividends. By way of comparison, that’s more than 12 percentage points higher than the annual return of the S&P/TSX Composite, which climbed just 6.5% a year over the same period.

Last year we found that our All-Stars bested every single Canadian equity fund over the prior five years. Well, we couldn’t resist making the comparison again. When we did, we discovered that over the last five years, our All-Stars beat the best Canadian equity fund (in either the pure or focused categories) by nearly two percentage points a year—and the second best fund by more than three percentage points a year. The S&P/TSX Composite, meanwhile, trailed by more than eight percentage points annually.

To be fair, the comparison isn’t completely precise. For instance, the performance period in question doesn’t match exactly. It’s off by a few days because we don’t recruit our team at exactly the same time each year. Also, we haven’t included trading commissions which, although low these days, vary from investor to investor. On the other hand, our gains don’t include dividends—whereas active-fund returns do—so we don’t think we’re being too unfair to the funds.

We’re very pleased with our performance record. As you can see in “Left in the dust,” if you had split $100,000 equally among our original All-Stars six years ago, then sold them and rolled your gains into the new batch each year, your portfolio would now be worth $285,000—almost triple your original investment. Still, we want to stress that while we’ve done very well over the last six years, those kinds of gains don’t come without risk. That means it’s almost inevitable that we will eventually run into a soft patch. We believe that our stock picking methodology works well over the long term, but we’re keenly aware—and you should be too—that we can’t predict the future from year to year. That means it’s quite possible that this year’s All-Stars could disappoint.

While nothing’s a sure thing, we still hope that our track record will whet your appetite for this year’s Top 200. As in prior years, we put each of Canada’s 200 largest companies through its paces and graded each one on its investment merit. On pages 62 to 69, we deliver an easy-to-use scorecard packed with just the sort of information that appeals to most investors. In fact, we think the Top 200 gives you a more objective look at large Canadian stocks than you’re likely to find from any other single source.

Importantly, the Top 200 offers a logical and consistent approach to selecting stocks that isn’t influenced by feelings or fleeting fads. Nor do we rely on gut instincts or happy visions of the future. Instead, our results are based entirely upon the numbers. Our opinions about a company don’t enter into it.

We begin by identifying the largest 200 companies in Canada by revenue. Using Bloomberg data, we evaluate each stock, first for its attractiveness as a value investment and then on its appeal as a growth investment. (Value investors like profitable stocks that trade at low multiples of book value and pay juicy dividends. Growth investors like companies with momentum and expanding earnings.) Our value and growth tests are driven by sophisticated calculations, but in the end we reduce everything to two grades: one for each stock’s value appeal, one for growth potential.

The grades work just like they did back in school. The best competitors are awarded an A. Solid athletes get by with a B or a C. Those in need of improvement go wheezing home with a D or even an F. A select group of stocks—those that manage to achieve at least one A and one B on the value and the growth tests—make our All-Star team. Only 12 stocks got the honour this year. But before we introduce the new All-Stars, here’s a quick recap on how we rate all 200 stocks.

The value test
Value investors like solid stocks selling at low prices, so we begin by looking for those with low price-to-book-value ratios (P/B). This number compares the market value of a company to how much cash you could raise by selling off the company’s assets (at balance-sheet prices) and paying off the firm’s debts. Low P/B ratios provide some assurance that you’re not paying much more for a stock than its parts are worth. To get top value marks, a stock has to possess a low price-to-book-value ratio compared to the market and also compared to its competitors within the same industry.

We also like to track price-to-tangible-book-value ratios. Tangible book value is like regular book value, but it ignores any intangible assets (such as goodwill) a firm may have. It’s an even sterner test of how much a company would be worth if it had to be closed down and sold off for scrap.

Other factors matter, too. Good companies produce profits, so we award higher scores to firms that have positive price-to-earnings ratios (this backward-looking figure is known as the trailing 12-month P/E ratio). We also reward a company if industry analysts expect it to be profitable and have a positive P/E over the next year (this number is known as the forward P/E ratio).

Because we like our investments to pay, we award extra marks to dividend-generating stocks—the stocks that dish them out tend to outperform. To ensure a company won’t capsize from excessive debt, we penalise companies living on credit. We award the best grades to firms with low leverage ratios (defined as the ratio of assets to stockholders’ equity) compared to their peers. Finally, we combine these factors into a single value grade. Only 21 stocks got an A this year.

Value Team

These 21 stocks earned an A when we went hunting for low-priced bargains

ALGOMA CENTRAL

ALC

ATCO

ACO.X

CANACCORD FINANCIAL

CF

COLABOR GROUP

GCL

DOREL INDUSTRIES

DII.B

EMPIRE

EMP.A

ENSIGN ENERGY SERVICES

ESI

FAIRFAX FINANCIAL

FFH

GENWORTH MI CANADA

MIC

GOODFELLOW

GDL

GROUPE AEROPLAN

AER

HIGH LINER FOODS

HLF

INDIGO BOOKS & MUSIC

IDG

MAPLE LEAF FOODS

MFI

NEWALTA

NAL

POWER CORP OF CANADA

POW

SHERRITT INTERNATIONAL

S

SUN LIFE FINANCIAL

SLF

TRANSCONTINENTAL

TCL.A

TVA GROUP

TVA.B

UNI-SELECT

UNS

The growth test
The first mark of a good growth stock is, not surprisingly, growth. We start by awarding high marks to any stock that achieved good earnings-per-share and sales-per-share growth over the past three years. (Given the recession, even a bit of earnings growth was something of a feat this year.) We also track each firm’s growth in total assets since last year to get a sense of recent trends.

We want to be sure that the market is taking note of a company’s improving situation, so we hand out additional marks to stocks that are strong performers relative to other stocks. In particular, we favour stocks that have provided good total returns over the past year.

As great as growth is, we hedge our bets by checking out each stock’s return on equity. This statistic measures how much a firm is earning compared to the amount that shareholders have invested. It is a key indicator of the quality of a business. Only those stocks with healthy returns on equity compared to others in their industry get top marks.

Finally, since no one wants be the last buyer in a bubble, we examine each stock’s price-to-sales ratio. This ratio measures the stock’s price in comparison to the company’s sales. Low to moderate price-to-sales ratios indicate stocks that are reasonably priced and we award them extra marks. In contrast, firms with high price-to-sales ratios may be glamour stocks that could disappoint. Putting these growth and quality indicators together, we arrive at a final growth grade. Only 21 out of 200 stocks earned an A this year.

Growth Team

These 21 stocks earned an A when we went hunting for earnings and sales growth

AGRIUM

AGU

ALIMENTATION COUCHE-TARD

ATD.B

ALLIANCE GRAIN TRADERS

AGT

ATCO

ACO.X

AUTOCANADA

ACQ

BCE

BCE

BMTC GROUP

GBT.A

CHURCHILL

CUQ

COGECO CABLE

CCA

COGECO

CGO

DOMTAR

UFS

HIGH LINER FOODS

HLF

LEON’S FURNITURE

LNF

LOBLAW COMPANIES

L

MAGELLAN AEROSPACE

MAL

METRO

MRU.A

RICHELIEU HARDWARE

RCH

SAPUTO

SAP

SUNOPTA

SOY

TELUS

T.A

WINPAK

WPK

The All-Star team
As we mentioned previously, only 12 stocks earned at least one A and one B on our value and growth tests.

We are pleased to see six of last year’s All-Stars make the cut again this year.The veterans are: ATCO (ACO.X), Dorel (DII.B), Fairfax Financial (FFH), High Liner Foods (HLF), Leon’s (LNF), and TVA Group (TVA.B). The new additions are: Alimentation Couche-Tard (ATD.B), AutoCanada (ACQ), Domtar (UFS), Goodfellow (GDL), Groupe Aeroplan (AER), and Magellan Aerospace (MAL).

High Liner has been on the All-Star team for the last two years and has climbed more than 57% since it debuted. It is also one of only two firms to get an A for both value and growth this year. As a result, the firm from Lunenburg, N.S., which serves up seafood to millions, remains a succulent investment.

ATCO is a sprawling utility and energy conglomerate run out of Alberta and is our second double-A stock this year. We’ve followed this firm for years and have come to appreciate its persistent dividend growth.

Our largest All-Star, by market capitalization, is the insurance firm Fairfax Financial which is run by noted value investor Prem Watsa. Remarkably, Watsa managed to guide the firm to profitability both as the markets fell during the Great Recession and as they rebounded. Based on his long-term record, it’s little wonder that many call him the Warren Buffett of the North.

Leon’s Furniture, originally of Welland, Ont., sells furniture, appliances and electronics. It also has an enviable growth record, considering its industry, and currently represents a good value.

Alimentation Couche-Tard runs more than 5,800 convenience stores across Canada and the U.S. under three main banners: Couche-Tard, Mac’s, and Circle K. It is this year’s largest All-Star by revenue.

Domtar, a Fortune 500 pulp and paper firm, nosed its way into this year’s list because it trades on the TSX and has significant operations in both the U.S. and Canada. But patriots should note that it is officially domiciled in the United States.

TVA Group, a subsidiary of Quebecor Media, operates the largest private French-language TV network in North America and sells a slew of consumer magazines.

Dorel makes bicycles and products for children, but don’t be fooled by its diminutive clients—it raked in more than $2 billion in sales over the last 12 months.

Groupe Aeroplan runs loyalty management operations, including a frequent flyer miles program and the complicated data analysis behind it.

The last three members of this year’s team are on the small side. As a result, they are best considered by more experienced investors. Magellan makes parts for the aerospace industry. But it comes with a side of risk because it is building a facility for the new Joint Strike Fighter which has become a bit of a political football. Goodfellow, of Delson, Que., is in the glamorous business of selling lumber and hardwood flooring, largely in central and eastern Canada. AutoCanada of Edmonton, Alta., profitably runs more than a score of auto dealerships in six provinces.

Before you rush out to buy any stock, do your own due diligence. Make sure that its situation hasn’t changed in some important way. Keep an eye out for stocks that trade infrequently—they deserve care. Read each firm’s latest press releases and regulatory filings. Scan newspaper stories to make sure you’re aware of important developments and breaking news. If you do, you’ll be more comfortable with your team—and greatly increase your chances of success.

]]>http://www.moneysense.ca/save/investing/mutual-funds/top-200-canadian-stocks-2011/feed/21Wealth: Believe and prosperhttp://www.moneysense.ca/spend/shopping/wealth-believe-and-prosper/
http://www.moneysense.ca/spend/shopping/wealth-believe-and-prosper/#commentsTue, 02 Feb 2010 21:17:37 +0000http://www.moneysense.ca/?p=2857Do traits shared by religious people make them more likely to become rich?

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Lisa Keister is an expert on being rich. She’s no investment genius, mind you, so don’t expect to see her hobnobbing at the billionaires’ club with Warren Buffett. Rather Keister, a professor of sociology at Duke University in North Carolina, is an authority on why and how people attain wealth.

Keister can reel off a long list of reasons why some people get rich and others don’t: education, inheritance, entrepreneurial savvy. But a few years ago, she began paying closer attention to a cause that she had once dismissed as far-fetched: religion. “I’d mention it at conferences and economists would laugh,” she says. “But when I’d ask people who are religious whether their faith affects how they handle money, they’d say ‘silly academic, of course.’ ”

For those who haven’t dusted off their King James Bible in a while, it may come as a surprise, but religion and money go hand in hand. Scripture refers to money and finance over 2,000 times. Prayer only gets 500 mentions. Now researchers are discovering that religious people are better savers. And because they’re less likely to take chances on risky investments, they may do better in the stock market too.

Believing in a god on its own isn’t enough to make you a wise money manager. But the values of religious people do affect their approach to money, says Luc Renneboog, a professor of finance at Tilburg University in the Netherlands.

In a study last year, Renneboog found that Protestants are more likely to own stocks than Catholics. The reason: Protestants tend to believe that individuals are responsible for their own success or failure. Catholics, meanwhile, place more importance on the security of their families. So they’re more likely to buy a house than stocks, and leave money for their kids.
Similarly, Keister found vast differences in wealth in the U.S. between Jews and evangelical Christians (conservative Protestants). Growing up Jewish you’ll learn the importance of investing in stocks at a young age, says Keister. Conservative Protestants on the other hand, shun investing, marry young and put off buying a home.

The result: only 1% of Jews in the U.S. have no bank account, no stocks and don’t own a home. Fifteen per cent of conservative Protestants fit that description. “Conservative Protestants think ‘God will take care of me.’ So for them the church is a good investment—stocks not so much,” Keister says.

There’s no hard evidence that religious folks are more likely to make a killing in the markets yet. But some have noted that because they are more interested in spiritual than material gain, they may be less susceptible to the greed and fear that can lead investors astray.

Certainly George Athanassakos, who teaches value investing at the University of Western Ontario, has noticed that successful value investors tend to act in religious ways. “When I ask them what’s the biggest lesson they’ve learned in life they always respond by saying ‘humility and integrity,’” he says. “This is the foundation of every religion. So even if such investors aren’t religious, they sure behave as if they are.”

]]>http://www.moneysense.ca/spend/shopping/wealth-believe-and-prosper/feed/108Many wives are outearning their husbandshttp://www.moneysense.ca/news/many-wives-are-outearning-thier-husbands/
http://www.moneysense.ca/news/many-wives-are-outearning-thier-husbands/#commentsWed, 20 Jan 2010 19:46:38 +0000http://www.moneysense.ca/?p=2602Men can make a living by marrying rich.

]]>Here’s one way for out-of-work men to make a living — marry rich. Turns out a number of guys are doing just that, wedding older, wealthier women.

A Pew Research Center study revealed that 22% of wives make more money than their husbands, while 28% are more educated. That’s a big shift from 1970, when just 4% of women brought home more bacon than their spouse.

Vera Cohn, co-author of the study says marrying a higher income earner is giving many men a stable economic future. “Now with so many women working and achieving higher income, it’s increasingly a way for men to achieve economic security,” she says. “In that way, the genders are a little more similar than they were a few decades ago.”